July 31, 2009

From the Desk of Judicial Watch President Tom Fitton:

Dodd, Conrad Knew They Were Getting Sweetheart Mortgage Deals from Countrywide

The Senate Ethics Committee investigation looking into allegedly preferential treatment afforded powerful Senators Dodd (D-CT) and Conrad (D-ND) by mortgage giant Countrywide Financial has sprung a few leaks. And the emerging details do not look good for either senator.

According to The Associated Press:

Despite their denials, influential Democratic Sens. Kent Conrad and Chris Dodd were told from the start they were getting VIP mortgage discounts from one of the nation’s largest lenders, the official who handled their loans has told Congress in secret testimony.

Both senators have said that at the time the mortgages were being written they didn’t know they were getting unique deals from Countrywide Financial Corp., the company that went on to lose billions of dollars on home loans to credit-strapped borrowers. Dodd still maintains he got no preferential treatment.

Robert Feinberg, who worked in Countrywide’s VIP program, contradicted the repeated denials by Dodd and Conrad regarding their knowledge of the program. When asked directly whether the two Senators were aware they were receiving special VIP treatment, Feinberg simply said, "Yes."

The program was known as "Friends of Angelo," named after Countrywide’s chief executive at the time, Angelo Mozilo, who was recently charged with civil fraud and illegal insider trading. Dodd used two sweetheart mortgage loans in 2003 to refinance residences in Connecticut and Washington, DC, while Conrad took two loans the following year to refinance his beach house in Delaware and an apartment building in North Dakota.

Aside from Feinberg’s testimony regarding the senators’ knowledge of the program there is the documentary evidence as well.

In Dodd’s case two documents entitled "Loan Policy Analysis" clearly prove Countrywide allowed Dodd to obtain the loan without paying "origination fees," when Countrywide’s general policy is to collect these fees, also called "mortgage points."

And as far as Conrad is concerned, the North Dakota Senator sought to obtain a residential loan for his eight-unit apartment building when Countrywide’s residential loan limit is for buildings with no more than four units. "…See if the [loan executive] can make an exception due to the fact that the borrower is a senator," Martinez instructed Feinberg in an email obtained by The New York Times. The email string indicates Conrad was award of the four-unit restriction.

Dodd and Conrad went into spin/disinformation mode, with Conrad gong so far as to compare his sweetheart mortgage/bribe to an airline "frequent flyer" program.

Their Democratic compatriots control the Senate and the House so don’t expect too much investigation into this scandal. House Democrats have zero interest in subpoenaing information about the "Friends of Angelo" program, such as the full list of beneficiaries that is sure to include more politicians from both political parties.

The accusations of preferential treatment are particularly damaging for Senator Dodd, who chairs the Banking Committee, which is responsible for regulating the mortgage lending industry including companies such as Countrywide.

Despite the serious investigation into his corrupt relationship with Countrywide Dodd continues to rake in huge amounts of cash from lobbyists. According to The Associated Press: Even as Dodd "boasts about snubbing lobbyists…the embattled Connecticut Democrat is still cashing lobbyist campaign checks and rubbing shoulders with them at fundraisers and party gatherings."

And, of course, the Senate Ethics Committee investigation is taking place while Dodd is embroiled in a separate real estate scandal. As I’ve covered in recent issues of the Weekly Update, Judicial Watch filed a Senate Ethics Complaint against Dodd for undervaluing a property he owns in Ireland on his Senate Financial Disclosure forms.

Judicial Watch’s complaint forced Dodd to amend the forms. However, press reports suggest the property is still undervalued. Judicial Watch also alleges in the complaint that Dodd obtained a sweetheart deal for the property in exchange for his assistance in obtaining a presidential pardon for a long-time friend and business associate. The false financial disclosure forms were part of the cover-up.

Despite these scandals, Dodd continues to head the Senate Banking Committee and Conrad is in charge of the Senate Budget Committee. Think about that the next time you hear these committees talk about banking ethics or balanced budgets!

Judicial Watch Petitions California Supreme Court to Review Taxpayer Challenge to LA Sanctuary Policy

A few weeks ago, I told you that the California Court of Appeals refused to allow Judicial Watch’s taxpayer lawsuit against the LAPD’s illegal alien sanctuary policy Special Order 40 to go to trial. Obviously, we thought the court got it completely wrong. And for that reason we petitioned the California Supreme Court this week to review the case.

As you may recall, Judicial Watch filed this lawsuit on behalf of a taxpayer back in 2006 because we felt that Special Order 40, which impedes communication between local law enforcement agencies and federal immigration officials, is not only illegal but extremely dangerous. The policy is a clear violation of both federal immigration law and California State law, while also subjecting law abiding citizens to violent illegal alien criminals.

Now, with respect to the specific legal challenges we have made in this appeal, there are two main issues we have with the appellate court ruling. (Bear with me as this may get a bit technical.)

First, we have an issue regarding how the lower courts addressed California Penal Code 834b, which was approved by voters in 1994 as part of Proposition 187. This state law says, among other things, that "Every law enforcement agency in California shall fully cooperate with the United States Immigration and Naturalization Service [now Immigration and Customs Enforcement] regarding any person who is arrested if he or she is suspected of being present in the United States in violation of federal immigration law." The statute also prohibits local government entities from limiting the cooperation between local law enforcement officers and federal immigration officials.

The appellate court failed to apply 834b, finding that the provision was preempted by federal law and represents an "impermissible regulation of immigration."

Here’s how we responded in our petition: "It is ironic, to say the least, that a statute enacted by California voters to promote cooperation and information sharing between state, local, and federal law officials on immigration matters would be dismissed so easily as an impermissible regulation of immigration when federal law so obviously seeks to promote these very same goals."

Remember, the federal Illegal Immigration Reform and Immigrant Responsibility Act of 1996 promotes the free flow of information between state and local officials and federal immigration authorities.

In fact, earlier this year, the California Supreme Court found that a California statute allowing juveniles to be declared wards of the court based on violations of federal immigration laws was not preempted by the Supremacy Clause or any other federal law. The court had recognized that "a regime of cooperative federalism, in which local, state, and federal governments may work together to ensure the achievement of federal criminal immigration policy."

The second issue relates to the unreasonable burden of proof put on our client. Judicial Watch is challenging the appellate court’s decision to force a taxpayer challenging an administrative policy to satisfy the same heavy burden as a person bringing a "facial" challenge to a statue or ordinance. A "facial" challenge requires a litigant to prove that an ordinance or statute is always and under all circumstances unconstitutional. As Judicial Watch notes in its complaint, there is no statute or ordinance at issue in this lawsuit.

"Special Order 40 and the even more restrictive, unwritten practices and procedures by which the LAPD has implemented Special Order 40 most definitely are not statutes, ordinances or legislative enactments," Judicial Watch noted in its petition. Considering Judicial Watch’s taxpayer lawsuit as a "facial challenge" is inappropriate, therefore, "because, by definition, a practice does not have a ‘face.’ This is especially the case in legal challenges to unwritten practices such as Plaintiff has asserted here. There simply is no text to be analyzed."

Special Order 40 is a dangerous and unlawful "don’t ask, don’t tell" policy that puts law-abiding citizens at risk. There is no question Special Order 40 frustrates the free flow of communication between law enforcement officers and federal immigration officials in violation of federal immigration law. Let’s hope the California Supreme Court considers the serious legal issues at the center of this taxpayer lawsuit.

Judicial Watch Sends Letter Opposing Sotomayor Nomination to All U.S. Senators

This week, I sent a letter to each and every member of the U.S. Senate with a very simple message: Oppose Judge Sotomayor’s nomination for the U.S. Supreme Court.

Here’s the letter in its entirety:

Judicial Watch is a nonpartisan educational foundation that promotes transparency, integrity, and accountability in government, politics, and the law. Judicial Watch has hundreds of thousands of supporters across the country.

This letter is to state our opposition to the elevation of Judge Sonia Sotomayor to the Supreme Court of the United States.

Judge Sotomayor’s record is troubling in many respects, to include the following:

• Judge Sotomayor repeatedly made prejudiced and biased comments with regard to race and sex.
• Judge Sotomayor has expressly rejected the notion that courts should be impartial.
• Judge Sotomayor expressed support for the use of international law in deciding questions arising under the United States Constitution.
• Judge Sotomayor’s activity at the Puerto Rican Legal Defense and Education Fund suggests she personally supports a radical, judicial activist agenda that includes opposition to any restrictions on abortion rights and support of taxpayer funding for abortion.
• Judge Sotomayor wrongly dismissed significant constitutional questions concerning the Second Amendment, racial discrimination, and property rights with summary or cursory opinions.
• Her confirmation hearing testimony on the all the above points was, at best, disingenuous. Indeed, a July 19 Washington Post editorial supportive of Judge Sotomayor acknowledged that some of her testimony was "unconvincing and at times uncomfortably close to disingenuous."

Judge Sotomayor’s advocacy as a judge for a race-based ideological agenda is problematic enough, but elevating an individual with such a record to the Supreme Court will tend to undermine the American people’s confidence in the fair administration of justice by the High Court.

Accordingly, on behalf of the membership of Judicial Watch, I urge you to oppose Judge Sotomayor’s nomination to the Supreme Court.

On a related matter, we urge you to consider ways to reform the Senate’s handling of presidential judicial nominations. The current confirmation process is unnecessarily political and serves to undermine Americans’ faith in a fair and independent judiciary. Judicial Watch stands ready to work with you on ways to ensure a more rational approach to the Senate’s constitutional "advice and consent" role in judicial nominations.

Once again, I urge all of you to contact your U.S. Senators and tell them how you feel about this nomination. Feel free to refer to this letter. And if you want additional information on the Sotomayor nomination, check out the educational panel we held a few weeks ago. Here’s a link where you can get both a video and written transcript. The number for the U.S. Capitol switchboard, by the way, is 202-224-3121. Please call as soon as possible, as the Senate floor vote on her nomination will occur next week.

Judicial Watch Celebrates Fifteenth Anniversary

Judicial Watch celebrated its fifteenth birthday this week. Founded on July 29, 1994 — during the dark, scandalous days of the Clinton administration — Judicial Watch has since grown into the nation’s preeminent government watchdog organization. We have taken on Democrats and Republicans over the principle (and our motto) that "no one is above the law."

Special thanks to all of you who made our success possible with your financial and other support. We are truly a grassroots organization and have gained the support of over 850,000 people over the years. The growth of government and the Obama administration’s radical and fundamentally corrupt ways have created new challenges for our legal and investigative teams.

So if you’d like to make a special "birthday" gift to Judicial Watch or join our anti-corruption cause outright, please click here.

Until next week…

Tom Fitton
President

Judicial Watch is a non-partisan, educational foundation organized under Section 501(c)(3) of the Internal Revenue code. Judicial Watch is dedicated to fighting government and judicial corruption and promoting a return to ethics and morality in our nation’s public life. To make a tax-deductible contribution in support of our efforts, click here.